I think it was Woody Allen who said
that he spent a lifetime trying to arrive late at a Jewish event -- and never made
it. I came on time with my wife Sara, the mother of Avner and Yair, and itís very
good to be with all of you.

Members of the Obama Administration;
Senators, Members of Congress; my colleagues, Defense Minister Ehud Barak and Minister Uzi
Landau, Ambassador Michael Oren; and the distinguished ambassadors who are here
from many countries, Howard Kohr, David Victor, Lee Rosenberg; all the leaders
and all the members of AIPAC; and the 1300 students who came from around this
country:

My friends, as the world faces monumental
challenges, I know that America and Israel will face them together. We stand
together because we're fired by the same ideals and inspired by the same dreams
-- the dreams of achieving prosperity, security, and peace for all.

Now, this
dream seemed an impossibility to most Jews a century ago. You know, this month my father celebrated his
100th birthday. Thatís not his only achievement, but when he was born,
the Czars ruled Russia, the British Empire spanned the globe, and the Ottoman
Empire ruled the Middle East. During his lifetime, all three of these empires
fell. Others rose and fell. And the Jewish destiny, the pendulum of Jewish
fate, swung from the depths of despair to a new hope and a new beginning -- the rebirth of
the Jewish state.

See, for the first time in two
thousand years, a sovereign Jewish people could defend itself against attack.
And before that -- understand what transformation this was -- before that, in our
dispersion, we were powerless, absolutely powerless to defend ourselves against
an unremitting barrage of -- of savagery from the bloodletting in the Middle Ages, to
the expulsion of the Jews from England, and then from Spain and then from
Portugal, to the wholesale slaughter of Jews in the Ukraine, to the pogroms in
Russia, culminating in the greatest horror of all -- the Holocaust.

The founding of Israel didnít stop
the attack on the Jews. But it merely -- well itís more than merely -- it gave
the Jews the power to defend themselves against these attacks.

I want to tell you about the day
that I realized what this transformation was. It was the day I met Shlomit
Vilmosh over 40 years ago. I was 19 years old. I served with her son,
with Shlomitís son, Haim, in the same elite military unit. And one dark night
during a battle in 1969, Haim was killed in a burst of gunfire. At his funeral,
in a kibbutz in -- in the Galilee, I learned something. I discovered that Haim had
been born shortly after his mother and father had been freed from the death
camps of Europe. If Haim had been born two years earlier, this daring young
Israeli officer would have been tossed into the ovens like a million and a half
other Jewish children. Haimís mother, Shlomit, told me that though she was in
great anguish, she was proud. "At least," she told me -- and this is something Iíll
never forget as long as I live - "At least," she said, "my son fell wearing the
uniform of a Jewish soldier defending the Jewish state."

And time and again Israelís soldiers
were forced to repel the attacks of much larger enemies committed to our
destruction. Yet, when Egypt and Jordan realized that we could not be defeated in
battle, they embraced the path of peace and we value the peace treaties weíve
achieved with both countries. Yet, there are those -- there are those who continue the assault
against the Jewish state. There are those who openly call for our destruction.
They seek to achieve this goal through terrorism, missile attacks, and most
recently by developing atomic weapons.

Itís instructive that the
ingathering of the Jews to Israel doesnít deter them. In fact, it whets their
appetite. Iranís rulers say ďIsrael is a one bomb country." The head of
Hezbollah says: "If all the Jews gather in Israel, it will save us the trouble
of going after them worldwide."

My friends, these are unpleasant
facts, but they are the facts. The greatest threat to any living organism, to
any nation, is not to recognize danger in time -- not to recognize the facts.

Seventy-five years ago, many leaders
around the world put their heads in the sand. Untold millions died in the war
that followed. Ultimately, two of historyís greatest leaders helped turn the
tide. Franklin Delano Roosevelt and Winston Churchill helped save the world.
Indeed, they deserve every applause. They helped save the world, but they were
too late to save six million of my own people, the Jewish people. The future of
the Jewish state can never depend on the goodwill of even the greatest of men.
Israel must always reserve the right to defend itself.

A radical Iranian regime armed with nuclear weapons could
bring an end to the era of nuclear peace that the world has enjoyed for the last
65 years. Such a regime could provide nuclear weapons to terrorists. It might
even be tempted to use them and our world would never be the same. Iranís brazen
bid to develop nuclear weapons is certainly first and foremost a threat to my
country, to Israel, but itís a threat to the entire region; itís a threat to the
entire world. Israel thus expects the international community to act swiftly and
to act decisively to thwart this danger. But we always reserve the right of
self-defense.

And my friends, we have to defend
ourselves also against lies and against vilification. Throughout history --
Throughout our history,
the slanders against the Jewish people always preceded physical attacks against
us. In fact, they were used to justify those attacks. The Jews were called the
well-poisoners of mankind; the fomenters of instability; the source of all evil
under the sun. Unfortunately, as in the case of the physical attacks, these
libelous attacks against the Jews did not stop with the creation of Israel. Itís
true that for a time, overt anti-Semitism was held in check by the -- by the shame and the
shock of the Holocaust. But only for a time.

In recent decades the hatred of the
Jews has reemerged with increasing force, but with an insidious twist. It is not
merely directed at the Jewish people. Itís increasingly directed at the Jewish
state. And in its most pernicious form, it argues that if only Israel did not
exist, many of the worldís problems would go away.

Now, I want to be clear. This
doesnít mean that Israel is above criticism. Of course not. Israel, like any
democracy, has its imperfections; but we strive to correct them through open
debate and through scrutiny. Israel has independent courts, the rule of law, a
free press and a vigorous parliamentary debate. Believe me, itís very vigorous.
Well youíve through -- you've just gone through a week of healthcare voting. In Israel, every week
is healthcare week. It doesnít stop.

And I know that in this city members of
Congress refer to eachother as "My distinguished colleague from Wisconsin," "the
distinguished Senator from California." In Israel, Members of Knesset donít speak
of their distinguished colleagues from Beíer Sheva or Kiryat Shmona. We say --
well, you don't know -- well, you don't want to know what we say.

Because in
Israel, self-criticism is a way of life, and we also accept that criticism is
part and parcel of the conduct of international affairs. But Israel should be
judged by the same standards applied to other nations and to other democracies.
Sometimes I think thereís a -- Sometimes I think there's a triple standard: one standard for the dictatorships,
a second standard for the democracies, and a third standard is a standard for
Israel. We should be judged by one standard. And allegations made against the
State of Israel must be grounded in fact. One allegation that is not grounded
in fact is the attempt to describe the Jews as foreign colonialists in their own
homeland. This is -- This is one of the great lies of modern times.

In my office, I have a signet ring
that was loaned to me by Israelís Department of Antiquities This ring was found
right next to the Western wall, but it dates back 2800 years ago, two hundred years
after King David declared Jerusalem as our peopleís capital. Now, this ring is a seal
of a Jewish official, and his name is inscribed in it -- on it in Hebrew. The name is:
Netanyahu. Netanyahu Ben-Yoash. Now thatís my last name. My first name, Benjamin,
dates back 1,000 years earlier to Benjamin, the son of Jacob. One of Benjaminís
brothers was named Shimon, which also happens to be the name of my good
friend, Shimon Peres, the President of Israel. You see, nearly 4000 years ago, Benjamin,
Shimon, and their ten brothers roamed the hills of Judea.

Ladies and gentlemen, the connection
between the Jewish people and the Land of Israel cannot be denied. The
connection between the Jewish people and Jerusalem cannot be denied. The Jewish
people were building Jerusalem 3000 years ago and the Jewish people are
building Jerusalem today. Jerusalem is not a settlement. Itís our capital.

In Jerusalem, my government has
maintained the policies of every single Israeli government since 1967, including
those led by Golda Meir,
Menachem Begin and
Yitzhak Rabin. Today, nearly a
quarter of a million Jews -- thatís almost half the cityís Jewish population -- live
in neighborhoods that are just beyond the
1949 armistice lines. All these
neighborhoods are within five minutes from the Knesset. They are an integral and
inextricable part of modern Jerusalem. Everyone knows -- everyone: Americans,
Europeans, Israelis certainly, Palestinians -- everyone knows that these
neighborhoods will be part of Israel in any peace settlement and therefore
building in them in no way precludes the possibility of a two-state solution.

And I want to say one more thing
about our policies in Jerusalem. You know, nothing is -- nothing is rarer in the Middle East than
tolerance for the belief[s] of others. But itís only under Israeli sovereignty in
Jerusalem that religious freedom for all faiths has been guaranteed -- and we
shall continue to guarantee that religious freedom for everyone.

Ladies and gentlemen, while we
cherish our homeland, we also recognize that Palestinians live there as well. We
donít want to govern them. We donít want to rule them. We want them as our
neighbors, living freely in security, dignity, and peace. Yet Israel is unjustly
accused of not wanting peace with the Palestinians. Nothing could be further
from the truth. My government has consistently shown its commitment to peace in
both word and deed.

From day one, we called -- I called on the
Palestinian Authority to begin peace negotiations without delay; and I make that
same call today. President Abbas, come and negotiate peace. You
know, that -- thatís so elementary
and so obvious. Youíd think we donít have to say it because leaders who truly
want peace should be able to sit face-to-face with each other and negotiate the
peace. You canít successfully end a negotiation for peace if you donít begin it,
so I call on the Palestinian leadership, come and negotiate peace.

Of course, the United States can
help the parties resolve their problems but it cannot solve the problems for the
parties. Peace cannot be imposed from the outside. It can only come through
direct negotiations in which we develop mutual trust -- that mutual trust that is
necessary to forge a common future.

Last year, I spoke of a vision of
peace in which a demilitarized Palestinian state recognizes the Jewish state.
Just as the Palestinians expect Israel to recognize a Palestinian state, we
expect the Palestinians to recognize the Jewish state.

My government has removed
hundreds of roadblocks, barriers, earth ramps, checkpoints, and this has
facilitated tremendous Palestinian movement. And as a result, we have helped spur,
-- actually an incredible boom given todayís world economy -- an incredible boom in
the Palestinian economy. You have coffee shops, restaurants, businesses,
shopping malls, even multiplex studios. Just go to Ramallah and Jenin. And that's not come about out of sheer error. We have made it possible. You cannot do
this if you cannot move trucks, goods, people, customers. That's been our
policy. And we added to that an unprecedented moratorium on new Israeli
construction in Judea and Samaria. This is what my government has done for
peace.

Now I ask you, what has the Palestinian
Authority done for peace? Well, you can judge for yourself. They've placed
preconditions on peace talks, waged a relentless international campaign to
undermine Israelís legitimacy, and promoted the notorious
Goldstone report that
falsely accuses Israel of war crimes. In fact, theyíre doing that right now at
the UN at the grotesquely misnamed
UN Human Rights Commission. And I want to
use this opportunity to thank President Obama and the Congress of the United
States for their efforts to thwart this libel, and I ask for the continued
effort this week to fight this lie.

Regrettably, the Palestinian
Authority has also continued the unabated incitement against Israel in their
state-controlled media, in their schools and other institutions that come
directly under their control, and some others too. A few days ago, in a public
square near Ramallah, the Palestinians named this square after a terrorist who
murdered 38 innocent Israeli civilians including 13 children, including an
American citizen, the photographer,
Gail Rubin. They named a public square after
this murderer and the Palestinian Authority did nothing.

Ladies and gentlemen, peace requires
reciprocity. It cannot be a one-way street in which Israel makes all the
concessions and the Palestinian Authority makes none. That's got to change.
Israel stands ready to make the compromises necessary for peace, but we expect
the Palestinians to compromise as well -- to do their part.

But thereís one thing Iíll never
compromise on and that one thing is Israelís security. Let me express to you the
difficulty of trying to explain Israelís security predicament to the citizens of
the United States -- a country that's 500 times the size of Israel. So, I thought
how I could best bring it home, and I ask you to imagine that the territory of the
United States was compressed down to the size of New Jersey. Now, I'm not
picking at New Jersey because our ambassador, Michael Oren, comes from New
Jersey. It happens to be the right size.

So now, you squeeze the
United States down to the size of New Jersey and next you put on New Jerseyís
northern border an Iranian terror proxy called Hezbollah which fires 6,000
rockets into that small state. Then imagine that this terror proxy amasses
another 50,000 rockets to fire at you. Now Iím not finished. You take New Jerseyís
southern border and you put another Iranian terror proxy on it and you call it
Hamas. And it too fires 6,000 rockets into your territory while smuggling even
more lethal weapons into its territory.

You think youíd feel a little
vulnerable? You'd think youíd expect some understanding from the international
community when you have to defend yourself? I think any fair-minded person
would recognize that we face security problems and challenges unlike any other
nation on earth. And therefore -- And therefore, a peace agreement with the Palestinians must
have effective security arrangements on the ground -- not just on a piece of
paper -- on the ground.

We must make sure that what happened
in Lebanon and Gaza doesnít happen again in the West Bank. Now let me explain what
our main security problem with Lebanon is. Itís not Israelís border with Lebanon.
Itís Lebanonís porous border with Syria through which Iran and Syria smuggle
thousands and thousands of rockets and missiles to Hezbollah. And our main
security problem with Gaza is not Israelís border with Gaza. Itís Gazaís border
with Egypt under which there are about a thousand tunnels dug through which Hamas
smuggles weapons to fire at us.

My friends, experience has shown
that only an Israeli presence on the ground can prevent or limit weapons
smuggling. And this is why a peace agreement with the Palestinians must include
an Israeli presence in the eastern border of a future Palestinian state. If
peace with the Palestinians proves its durability over time, we can review
security arrangements. We are prepared to take risks for
peace, but we will not be reckless with the lives of our citizens and the life
of the one and only Jewish state.

Ladies and gentlemen, the people of
Israel want a future in which our children no longer experience the horrors of
war. We want a future in which Israel realizes its full, great potential as a
global center of technology, anchored in its values, living in peace with all
its neighbors. I envision an Israel that can dedicate even more of its
scientific and creative energies to help solve some of the great problems of our
time, foremost of which is finding a clean and affordable substitute for
gasoline. And when we find that alternative, we will stop transferring hundreds
of billions of dollars to regime[s] which support terror worldwide.

I am confident that in pursuing
these goals, we have the enduring friendship of the United States of America,
the greatest nation on earth. The American people have always shown their
courage, their generosity, their decency. From one President to the next, from
one Congress to the next, Americaís commitment to Israelís security has been
unwavering. In the last year, President Obama and the U.S. Congress have given
meaning to that commitment by providing Israel with military assistance, by
enabling joint military exercise, and by working on joint missile defense.

So too -- So too, has Israel been a staunch
and steadfast ally of the United States. As Vice President Biden has said,
America has no better friend in the community of nations than Israel. I say that
too. For decades, Israel served as a bulwark against Soviet expansionism. Today,
it is helping America stem the tide of militant Islam. Israel shares with
America everything -- and I mean everything -- that we know about fighting a new kind
of enemy. We share intelligence. We cooperate in so many ways, countless ways
which Iím not at liberty to divulge.

This cooperation is important for us, for
Israel, but it is also helping save American lives. Our soldiers and your soldiers fight
against fanatic enemies that loathe our common values. In the eyes of these
fanatics, we are you and you are us. To them, the only difference is that you
are big and we are small. You see, you are the "Great Satan" and we are the "Small
Satan."

Now, thereís an important point here: This fanaticismís hatred of Western
civilization predates the establishment of modern Israel by a thousand years.
Militant Islam does not hate the West because of Israel. It hates Israel because
of the West -- because it sees Israel as an outpost of freedom and democracy that
prevents them from overrunning the Middle East. That is why when Israel stands
against its enemies -- it stands against Americaís enemies.

President Truman, the first
leader to recognize Israel, had this to say: I have faith in Israel and I
believe it has a glorious future -- not just as another sovereign nation,
but as an embodiment of the great ideals of our civilization.1

My friends, we are gathered here
today because we believe in these common ideals of our great civilization. And
because of these ideals, I'm certain that Israel and America will always stand
together.